Release Explanation: Measures the rate of inflation of manufacturers when purchasing Goods and Services; the rate of Inflation at the factory Gate. “Usually, an increase in the price of raw Goods and services gets passed on to the consumer, therefore this is the first stage on Retail Inflation” TheLFB-Forex.com Trade Team added.
TheLFB-Forex.com Trade Desk Thoughts: Factory prices increased for a third consecutive month, after plunging lower for six months. The input prices, or the price at which producers and manufacturers buy materials and fuel, rose in March by 1.0%, much more than expected. The output price, or the prices at which manufacturers sell, gained 0.1% for a third consecutive month. Input prices are down 0.4% from one year ago, while output prices reached 2.0% in March from one year earlier.
“The upward pressure on the monthly data came from a rise in the price of crude oil, helped by the strong declines in the pound’s value. To some extent, the PPI read does not justify the BoE view that sees a real danger of “undershooting” the inflation target,” TheLFB-Forex.com Trade Team said.
Forex Technical Reaction: The pound declined 100 pips during the European session on very strong momentum. The pound is now preparing for the BoE’s interest rate decision scheduled for 07:00 EST